Ace Inc. has 10,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outs

Question

3 years ago

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Ace Inc. has 10,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outs

tanding at December 31, 2014. What is the annual dividend on the preferred stock?a. $50 per shareb. $50,000 in totalc. $5,000 in totald. $0.50 per share

Business

1 answer:

REY [17] · Answer 1 · 2022-03-31T01:03:53+03:00

Answer:

b. $50,000 in total

Explanation:

Preference shareholders: The preference shareholders are that shareholders who receive the divided before equity shareholders

The computation of the annual dividend is shown below:

= Number of shares × price per share × rate

= 10,000 shares × $100 × 5%

= $50,000

The annual dividend for preference shareholders will be computed by applying the number of shares, the price per share, and the rate.